Airbus To Open A320 Plant in U.S.

Airbus plans to start building a new A320-family assembly plant in Mobile, Ala., next summer, the European airframer confirmed today, marking yet another expansion of its narrowbody production ambitions. Scheduled for completion at the beginning of 2016, the plant will produce between 40 and 50 A319s, A320s and A321s annually and employ 1,000, estimates Airbus. Plans call for the first airplane parts to arrive in 2015 and the first completed airplane to roll out in 2016.

While many expect the $600 million investment in the U.S. will accompany a less tangible cost in the form of worker and government opposition in Europe, the payback in lower wages and production costs (due to the relative weakness of the U.S. dollar compared with the Euro) apparently proved enticing enough to outweigh any threat of political fallout at home.

The new factory also might help U.S. airlines to more readily make the case for buying A320s carrying the so-called “made in America” stamp. Airbus now controls only 20-percent of the U.S. market for narrowbody jets.

Once the Mobile plant opens, Airbus will operate A320 assembly sites in three continents. The A320 facility in Tianjin, China, which Airbus opened in September 2008 along with a Chinese consortium consisting of the Tianjin Free Trade Zone and Avic, had delivered 80 A320s as of March this year. “The time is right for Airbus to expand in America,” said Airbus president and CEO Fabrice Bregier. “The U.S. is the largest single-aisle aircraft market in the world—with a projected need for 4,600 aircraft over the next 20 years—and this assembly line brings us closer to our customers.”

The deal to build the assembly line in Mobile marks the consummation of a long courtship between EADS (parent company of Airbus) and Alabama officials, whose efforts to attract Airbus to build aerial tankers with Northrup Grumman fizzled after the U.S. Air Force finally awarded the contract to Boeing last year. A so-called right to work state, Alabama bars the practice of requiring union membership as a condition of employment. Non-union workers would staff the new Airbus factory and earn significantly less than their counterparts in Europe, or Boeing workers in the Puget Sound area of Washington state. Boeing, of course, enjoys similar benefits in South Carolina—another right-to-work state—where non-union employees assemble 787 Dreamliners.

Another incursion onto U.S. soil by EADS in 2004 has since paid significant dividends, helping it win a contract in 2006 to supply UH-72 Lakotas to the U.S. Army. The American Eurocopter plant in Columbus, Mississippi, also produces A350 B2 and B3